EOG Resources, Inc. Q4 FY2025 earnings call

• 2025 was remarkable with disciplined capital allocation, strong execution, and robust free cash flow. Exceeded oil and volume targets, drove down well costs, had peer-leading price realizations. Completed Encino acquisition, entered international exploration, and brought online Janus gas processing plant. Committed to sustainability. Generated $4.7 billion free cash flow and returned to shareholders. 2026 plan prioritizes activity in Delaware Basin, Utica, Eagle Ford, Dorado, with $6.5 billion capital spending midpoint, expecting $4.5 billion free cash flow. Focus on lateral length optimization, well cost reductions, cash operating cost control. Encino integration ahead of schedule with synergy captures. Dorado progressing as new foundational asset with low breakeven.

In 2025, EOG Resources had strong financials. Adjusted net income was $5.5 billion or $10.16 per share, free cash flow was $4.7 billion. Fourth quarter 2025 generated adjusted earnings per share of $2.27 and adjusted cash flow from operations per share of $4.86, building free cash flow of nearly $1 billion. Proved reserves increased by 16% to 5.5 billion barrels of oil equivalent. Product segments include Delaware Basin, Utica, Eagle Ford, Dorado, and international. Delaware Basin saw well cost reductions and infrastructure investments. Utica benefited from Encino acquisition synergies. Eagle Ford had efficiency gains. Dorado is a growing gas asset. International exploration in UAE and Bahrain is ongoing.

2026 capital spending midpoint is $6.5 billion, expected to generate $4.5 billion free cash flow using strip pricing. Breakeven price to cover 2026 capital program and regular dividend is $50 WTI. Updated three-year scenario shows 5% cash flow and greater than 6% free cash flow compound annual growth rates, cumulative free cash flow of $10 billion to $18 billion. Natural gas outlook positive with U.S. demand growth. Oil fundamentals have global demand growth and geopolitical factors providing price support.

Q: Neil Singhvi Mehta asked about well composition and activity in 2026, especially Delaware Basin slowdown.

A: Ezra Y. Yacob said 2026 plan optimizes investment across high-return plays, Delaware Basin activity supports capital efficiency with deep inventory.

Q: Neil Singhvi Mehta followed up on Delaware well result concerns.

A: Jeffrey R. Leitzell said Delaware has seen lateral length extension, cost reduction, and improved economics despite some lower productivity per well.

Q: Stephen I. Richardson asked about Dorado activity and LNG contracts.

A: Ezra Y. Yacob said Dorado has low breakeven, growing production, and increased LNG exposure.

Q: Doug Leggate asked about free cash flow visibility post Encino.

A: Ezra Y. Yacob clarified Delaware Basin free cash flow potential, Jeff Leitzell discussed maintenance capital.

Q: Scott Michael Hanold asked about Permian productivity and natural gas supply.

A: Ezra Y. Yacob said Permian primary targets have consistent performance, EOG is working on data center exposure.

Q: Derrick Whitfield asked about international role in three-year outlook.

A: Ezra Y. Yacob and Keith P. Trasko discussed international exploration plans.

Q: Charles Meade asked about UAE and Bahrain communication.

A: Ezra Y. Yacob discussed international communication and decision-making.

Q: Phillip J. Jungwirth asked about oil growth and Encino synergies.

A: Ezra Y. Yacob and Jeffrey R. Leitzell discussed oil growth potential and Encino synergy drivers.

Q: Matthew Portillo asked about Permian lateral length and Dorado productivity.

A: Jeffrey R. Leitzell discussed lateral length progress and Dorado productivity improvements